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Ichimoku Kinko Hyo Indicator

Ichimoku is a Japanese charting methodology created by a writer, journalist, and editor for a Japanese newspaper, who operated under the pseudonym Ichimoku Sanjin.

  • Ichimoku meaning: "a glance" or "a look"
  • Kinko means "equilibrium" or "balance"
  • Hyo is a Japanese term/word for "chart"

Thus, Ichimoku Kinko Hyo means, "a glance at an equilibrium chart". Ichimoku attempts to identify the likely direction of bitcoin price & help the bitcoin trader to determine the most suitable time to enter or exit the btcusd market.

Ichimoku Kinko Hyo Bitcoin Indicator - Ichimoku BTCUSD Indicator - Ichimoku BTCUSD Indicator Tutorial

Calculation

This btcusd indicator consists of five lines drawn using the midpoints of previous highs and lows. The 5 lines are calculated like shown below:

1) Tenkan Sen: Conversion Line: Red Line (Highest High + Lowest Low) / 2, for the last 9 bitcoin price periods

2) Kijun-Sen: Base Line: Blue Line (Highest High + Lowest Low) / 2, for the last 26 bitcoin price periods

3) Chikou Span: Lagging Span: Green Colored Line Today's closing bitcoin price drawn 26 bitcoin price periods behind

4) Senkou Span A: Leading Span A = (Tenkan Sen + Kijun Sen) / 2, drawn 26 bitcoin crypto price periods ahead

5) The Senkou Span B: Leading Span B: (Highest High + Lowest Low) / 2, for the past 52 btcusd price periods, drawn 26 btcusd cryptocurrency price periods ahead

Kumo: Cloud: area between Senkou Span A & B

BTCUSD Analysis and How to Generate Signals

Bullish signal - Tenkan-Sen crosses the Kijun Sen from below.

Bearish trading signal - Tenkan-Sen crosses the Kijun-Sen from above.

However, the strength associated with the buy signals and the sell signals generated for bitcoin displays variations across different zones.

Ichimoku Kinko Hyo Bitcoin Indicator - Ichimoku BTCUSD Indicator - Ichimoku BTCUSD Indicator Example Explained

Technical Analysis in Bitcoin Crypto Currency Trading

Bullish cross-over signal forms above Kumo (clouds),

Strong buy bitcoin signal.

Bearish cross-over signal forms below Kumo (clouds),

Strong sell bitcoin signal.

A bullish or bearish cross-over in the Kumo clouds gives a medium Bitcoin signal. It points to buy or sell.

A bullish crossover that happens below the clouds is seen as a weak sign to buy cryptocurrency, while a bearish crossover above the clouds is a weak sign to sell bitcoin.

Support & Resistance Levels

Support & resistance levels can be predicted by presence of Kumo (clouds). Kumo can also be used to identify the current bitcoin trend of the btcusd market.

  • If bitcoin price is above the Kumo, the current market bitcoin trend is said to be upwards.
  • If bitcoin price is below the Kumo, the current market bitcoin trend is said to be downwards.

Chikou Span or Lagging Span is also used to figure out the power of the buy or sell bitcoin signal.

  • If the Chikou Span indicator is below the closing bitcoin price of the last 26 periods ago and a sell short signal is given, then the strength of the bitcoin trend is downward, otherwise the trading signal is considered to be a weak sell bitcoin signal.
  • If there is a bullish signal and the Chikou Span is above the bitcoin price of the last 26 periods ago, then the strength of the bitcoin trend is to the up side, otherwise it's considered to be a weak buy bitcoin signal.

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